By Michael Ford, Chief Revenue Officer, Revecore
LinkedIn: Michael Ford, J.D
LinkedIn: Revecore
Hospitals have spent years building processes to fight denials, including appeal letters, peer-to-peer reviews, and dedicated denial management teams. But a growing share of the problem hospitals face today doesn’t come from denials at all. It comes from claims that sit unresolved without ever receiving a formal denial.
Instead of issuing a denial, payers are increasingly holding claims in limbo: requesting additional documentation, flagging them for further review, or simply letting them sit. In some cases, claims remain unresolved for 90 to 180 days or longer, with no formal determination ever issued. A 2022 American Hospital Association survey of nearly 800 hospitals found they were collectively carrying $6.4 billion in claims unpaid for six months or longer. That kind of open-ended status is often worse for a hospital than a denial. A denial at least comes with a reason and a path to appeal. A claim stuck in review offers neither. For health providers, cash flow deteriorates even though denial rates may appear stable. Meanwhile, insurers are recognizing that delaying payments improves their own cash position while earning investment income on retained reserves.
Why These Claims Fall Through the Cracks
Nearly every state has a prompt payment law requiring insurers to pay claims within a defined window, typically 30 to 45 days. In practice, these laws have a built-in gap: they generally apply only to “clean claims,” and they allow insurers to request additional information before the payment clock starts. State insurance regulators acknowledge the ambiguity this creates, fielding recurring provider questions about whether a claim can be pended indefinitely as “incomplete” rather than formally denied. A request for more documentation resets the clock, so a claim that was otherwise clean can remain unresolved for months without the insurer technically violating the law, or incurring a penalty fee
That gap matters because the revenue cycle’s entire dispute infrastructure is built around denials. Appeals require a denial code, a stated reason, and a deadline to respond. When a payer significantly delays a formal determination, hospitals have nothing to appeal against. Staff are forced to make repeated calls, resubmit documentation, and escalate internally – all of which adds to internal workload and cost to collect –  but no regulatory or contractual mechanism forces a resolution. The claim remains open, so hospitals lose reliable visibility into their forecasted revenue, and payers can adjust or close it out later with little scrutiny.
Payer Automation Has Accelerated the Cycle
Insurers have adopted AI and automation to manage claims at scale, and some of that technology now holds, suspends, or adjusts claims in ways that avoid triggering a formal appeals process. Federal lawmakers have already scrutinized how insurers deploy predictive algorithms in coverage decisions: a 2024 Senate investigation found automation had reshaped how quickly, and how often, coverage decisions were reached. The dynamic hospitals now describe is a variation on that theme: a claim can be flagged, routed for review, or partially adjusted without ever generating the denial notice that would start an appeal clock. As hospitals build workflows to detect these patterns, payers adjust their own logic in response, and the claims stuck between these shifting tactics are often the ones that stall the longest. These aren’t necessarily random claims, either. A national provider survey found that denials tend to be more common among higher-cost treatments, with the average denied claim tied to charges of $14,000 or more. The same prior authorization and medical necessity requirements that make those claims more likely to be denied also make them more likely to be flagged for extended review, which suggests the claims sitting longest may also carry the most revenue at stake.
The Cost Shows Up Beyond the Balance Sheet
The financial impact of these delays is substantial and growing. The AHA’s 2025 Costs of Caring report found that hospitals spent an estimated $43 billion in 2025 trying to collect payments insurers owed for care already delivered, including nearly $18 billion overturning denials that were ultimately paid anyway. That friction doesn’t stay confined to the finance department. Patients feel it too: KFF polling has found that roughly a third of adults have skipped or postponed needed care over the past year because of cost or coverage uncertainty, and unresolved claims are often what stands between a patient and a clear answer about what they owe. A claims process that quietly stretches on for months doesn’t just strain a hospital’s cash flow. It worsens the patient experience, and it adds to the financial risk hospitals absorb every time a receivable ages past the point of expected and agreed upon recovery timelines.
Getting Ahead of the Reimbursement Delay
Hospitals don’t have to wait passively for these claims to resolve themselves. Some patterns are predictable enough to flag early. Claims involving certain payers, service lines, or documentation types are more likely to stall, and tracking claim age against payer-specific benchmarks can surface at-risk accounts before they cross the 90-day mark. Segmenting claims by aging and payer behavior, rather than treating all outstanding claims equally, lets revenue cycle teams prioritize follow-up on the accounts most likely to disappear into a review queue. The earlier a hospital identifies a claim that is drifting toward an indefinite hold, the more leverage it has to intervene before that revenue becomes difficult to recover.
Denials will always be part of the revenue cycle conversation. But for many hospitals today, the bigger challenge is the claims that never receive a decision at all. Until prompt payment laws and appeals processes catch up with how claims are actually managed, hospitals will need their own early warning systems to catch this revenue loss before it compounds.